Horizon quietly increases surcharge

The shipping company matches Matson with an increase to 18.5%

Horizon Lines Inc. has matched its chief competitor with an increase in its fuel surcharge to 18.5 percent beginning Monday for its Hawaii and Guam services.

The company, the second-largest ocean shipper in the islands, is increasing the surcharge 3.5 percentage points from 15 percent.

Horizon didn't publicly announce the increase, but instead disclosed the new rate through a service bulletin on March 15 -- five days after Hawaii's largest ocean shipper, Matson Navigation Co., announced its increase. Matson, headquartered in Oakland, is a wholly owned subsidiary of Honolulu-based Alexander & Baldwin Inc.

Horizon said its increase, which was filed with the Surface Transportation Board, will remain in effect throughout the second quarter "or until a significant trend in fuel costs warrants another adjustment."

Spokesmen in both Horizon's Honolulu offices and Charlotte, N.C., headquarters were unavailable to comment yesterday.

Matson, whose new rate goes into effect Sunday, said when it announced its rate increase that bunker fuel prices had risen 17 percent in the past three months and that its existing fuel surcharge had recovered only a portion of that increase. Furthermore, Matson said its fuel costs have risen 71 percent over the past year.

Horizon, which typically matches Matson on fuel surcharges, accounts for approximately 36 percent of total U.S. marine container shipments from the mainland to Alaska, Hawaii, Puerto Rico and Guam.

Container loads of food and household goods to those areas from the mainland represented about 40 percent of Horizon's $1.1 billion in revenue last year.

Earlier this month, Horizon said it will increase its hauling capacity between Hawaii and the West Coast as a result of an agreement to charter five new U.S.-flagged vessels from Ship Finance International Ltd.

Horizon said part of its fleet restructuring will include instituting a dedicated Hawaii service that will start in Tacoma, Wash., and proceed to Oakland, Calif., before heading to Honolulu and back to Tacoma.

The ships will service Hawaii twice a week but won't need to continue on to Guam and Asia..